Govt backs third sector for public services

The government has signalled its strongest commitment yet to a long-term future role for third sector organisations in delivering public services.

In his pre-Budget statement, Gordon Brown announced a series of proposals to simplify the commissioning process for charities and community groups bidding for work, and provide more stability in the way they are funded.

The government has long been in favour of awarding contracts to voluntary organisations, instead of to public sector bodies or private companies, in areas as diverse as national offender management, hospital meals or Jobcentre Plus.

Third sector organisations argue they are often best placed to carry out public services, as they are highly specialised and have a proven track record in providing support, in particular to the socially excluded.

However, charities complain they are hampered by too much red tape in bidding for contracts, while critics fear the government will use them as a substitute for taxpayer-funded public services.

In a new the action plan for third sector public service delivery, published alongside yesterday's pre-Budget report, the chancellor announced a new national centre to simplify the process of commissioning services to charities.

In an interim report on the sector's role in social and economic regeneration, Mr Brown also put forward plans for next year's comprehensive spending review, including a £30 million fund for community groups to take on local authority assets.

He also committed the government to three-year contracts for organisations designing and delivering public services, much-campaigned for by charities which argue a year is not long enough to deliver effectively on contracts.

Ed Miliband, minister for the third sector, said the plans would "break down barriers" facing voluntary organisations - and denied that allowing them to deliver more public services would lead to a reduction in statutory funding.

"The greater involvement of the third sector in delivery must not be about government abdicating its responsibility to fund public services," he insisted.

"Instead, it is about ensuring that, in the right circumstances, the sector can deliver services where it is best placed to do so."

Stephen Bubb, chief executive of the Association of Chief Executives of Voluntary Organisations (Acevo), welcomed the announcements, saying: "There have been significant barriers to the sector playing a bigger role, especially on contracting."

However, some charities warned further changes were needed. Claire Tickell, chief executive of leading children's charity NCH, said: "For many families, the support they get from the third sector can be a lifeline.

"But for the voluntary sector to reach the people who really need help, more changes are needed in the commissioning process."